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Five Hidden Reasons
You Need A Will
 Most
people don't appreciate the full importance of a will,
especially if they think their estate is too small to justify
the time and expense of preparing one.
And even people who recognize
the need for a will often don't have one, perhaps due to
procrastination or a disinclination to broach this sensitive
subject with loved ones. The truth is, almost everyone should
have a will.
Here are the five basic reasons
why:
Reason 1:
To Choose
Beneficiaries
The intestate succession laws of
the state in which you live determine how your property will
be distributed if you die without a valid will.
For example, in most states the
property of a married person with children who dies
intestate (i.e., without a will) generally will be
distributed one-third to the spouse and two-thirds to the
children, while the property of an unmarried, childless
person who dies intestate generally will be
distributed to his or her parents (or siblings, if the parents
are deceased).
These distributions may be
contrary to what you want. In effect, by not having a will,
you are allowing the state to choose your beneficiaries.
Further, a will allows you to specify not only who will
receive the property, but how much each beneficiary will
receive..
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Note: If you wish to leave property
to a charity, a will may be needed to accomplish this goal. |
Reason 2:
To
Minimize Taxes
Many people feel they do not
need a will because their taxable estate does not exceed
the amount allowed to pass free of federal estate tax.
These assumptions, however, should be reviewed given the
current state of change in the federal estate tax laws.
It is important to review and
update your will on a regular basis. Most wills were
written with the existence of a federal estate tax at a
certain level.
Further, your taxable estate
may be larger than you think. For example, life insurance,
qualified retirement plan benefits, and IRAs typically pass
outside of a will or estate administration. But retirement
plan benefits and IRAs (and sometimes life insurance) are
still part of your federal estate and can cause your estate to
go over the threshold amount.
Also, in some states, the
estate or inheritance tax differs from the federal laws. A
properly prepared will is necessary to implement estate tax
reduction strategies.
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For the rest of the 5 Hidden Reasons,
click here to go to the full article on the
newsletter section of our web site. |
As always you can call our offices if you have any
questions about these or any other accounting related issues, at 301-657-8080.
Regards, Paul Sullivan, CPA |
